AUD/USD trimmed a part of its intraday losses to a two-week low
The AUD/USD pair stalled its intraday decline near the 0.6960 area and recovered a few pips from a two-week low touched earlier this Wednesday. The pair was last seen trading just below the 0.6900 mark, still down nearly 0.20% for the day. A fresh leg down in the US Treasury bond yields failed to assist the US dollar to capitalize on its modest uptick, which, in turn, was seen as a key factor that offered support to the AUD/USD pair. That said, growing worries about a possible recession continued weighing on investors' sentiment and acted as a headwind for the risk-sensitive Aussie.
Traders also seemed reluctant and might prefer to move on the sidelines ahead of the key event risk - Fed Chair Jerome Powell's speech at the ECB forum in Sintra. Market participants remain divided about the prospects for more aggressive Fed rate hikes. Hence, Powell's comments will be scrutinized for clues about the policy tightening path.
This will play a key role in influencing the USD price dynamics and provide a fresh directional impetus to the AUD/USD pair. From a technical perspective, spot prices bounced from the vicinity of the monthly swing low, making it prudent to wait for some follow-through selling below the 0.6850 region before positioning for any further depreciating move. Nevertheless, the fundamental backdrop still seems tilted in favor of bearish traders, suggesting that any attempted recovery move runs the risk of fizzling out rather quickly. The AUD/USD pair remains vulnerable to sliding further beyond the YTD low, around the 0.6830-0.6825 region touched in May, and aim to test the 0.6900 round-figure mark.
This will play a key role in influencing the USD price dynamics and provide a fresh directional impetus to the AUD/USD pair. From a technical perspective, spot prices bounced from the vicinity of the monthly swing low, making it prudent to wait for some follow-through selling below the 0.6850 region before positioning for any further depreciating move. Nevertheless, the fundamental backdrop still seems tilted in favor of bearish traders, suggesting that any attempted recovery move runs the risk of fizzling out rather quickly. The AUD/USD pair remains vulnerable to sliding further beyond the YTD low, around the 0.6830-0.6825 region touched in May, and aim to test the 0.6900 round-figure mark.